Japanese
Candlesticks are the only analysis technique
I need.
-
False. Japanese Candlesticks are a very
good analysis technique, but it is imporant
to include other forms of analysis. For
example, technical indicators, visual confirmation
of trends, support/resistance, risk management
and others.
Dojis
are good top and bottom formation indicators.
-
True. Although confirmation of a top or
bottom is often required before actions
should be taken.
Large
patterns are better than small patterns.
-
False. Japanese Candlesticks patterns come
in all shapes and sizes. Traders should
not reply on larger patterns over smaller
patterns. They both have the potential for
moving the markets.
Japanese
Candlesticks work best on intra-day charts.
-
Somewhat False. Japanese candlesticks were
designed for use with weekly charts (or
longer). They do work well with intra-day
charts, but often intra-day trades need
to use multiple time-frames. For example,
using a 2 minute with a 5 and 10 minute
will provide the day trader with the ability
to watch the intermediate term trend and
trade the short term trend.
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